The short answer

A well-diversified portfolio for a South African abroad spreads your money across asset types (mainly shares for growth and bonds for stability, with cash for near-term needs), across the world (thousands of companies in dozens of countries rather than mainly the JSE), across currencies (matched to where you'll spend the money, and not all in rand), and across time (investing regularly and holding for the long term). The mix between shares and bonds depends on your goals, timescale and how comfortable you are with ups and downs. Keep costs low, use funds based outside the US to avoid US estate tax, hold near-term spending in baht, and rebalance once a year. Lawrence builds diversified portfolios for South Africans in Thailand — book a free review to get started.

Why diversification works so well

Diversification works because different investments don't all move together. In any year, some markets rise while others fall; some industries boom while others struggle; bonds often hold steady when shares wobble; and the rand can move sharply against other currencies. By owning a broad mix, the strong performers help carry the weak, and the overall ride becomes much smoother.

Crucially, diversification doesn't mean giving up growth. Over the long run, broad share markets have rewarded patient investors handsomely. Prudential Investment Managers' analysis of the JSE over more than fifty years found that shares beat cash in about 78% of ten-year periods — and a global portfolio spreads that opportunity across the whole world. What diversification removes is the risk of one company, one sector, one country or one currency derailing your plans.

Three things diversification does for you

• Smooths the journey — fewer sharp drops, which makes it far easier to stay invested.
• Protects against the unexpected — no single failure can sink your portfolio.
• Captures growth wherever it happens — you don't need to guess which market will lead next.

That last point matters more than most people realise. Market leadership changes over time, and almost nobody predicts it consistently. A diversified investor doesn't need to.

The five ways to diversify

A truly diversified portfolio spreads risk in five different directions. For a South African abroad, all five matter.

1. Across asset types

The biggest decision in any portfolio is the split between shares (ownership of companies, the main engine of long-term growth), bonds (loans to governments and companies, steadier and income-producing) and cash (safe and instantly available, but unlikely to beat inflation over the long term). Some portfolios add a smaller slice of alternatives — such as structured products or other investments that behave differently from mainstream markets.

2. Across companies and industries

Owning a handful of shares concentrates your risk in a few businesses — and the JSE itself is dominated by a relatively small number of large companies. A global fund holding hundreds or thousands spreads it across technology, healthcare, banks, energy, consumer goods and every other part of the economy.

3. Across countries

South Africa makes up less than 1% of world stock markets — MSCI's broadest global index put it at about 0.4% in mid-2026. The United States is around 64% of MSCI's main global index, followed by Japan, Taiwan and Canada, with dozens of other markets after that. A global portfolio owns a share of all of them.

4. Across currencies

A global portfolio naturally spreads your money across many currencies — dollars, euros, yen and more — which reduces your dependence on the rand. For a South African abroad, the aim is to match each part of your money to the currency you'll spend it in, and to hold long-term money in a spread of hard currencies.

5. Across time

Investing regularly, rather than all on one day, and holding for many years spreads your entry points and gives markets time to reward you. Time is the diversification that turns short-term ups and downs into long-term growth.

The world in one portfolio

Here's how the world's stock markets are made up, according to MSCI's global indexes in 2026. A globally diversified portfolio owns a share of every one of these markets — and dozens more.

MSCI ACWI country weights, 30 September 2026: 23 developed and 24 emerging markets. South Africa from the MSCI ACWI IMI geographic breakdown, 30 June 2026. Bars show each country relative to the US. A global portfolio doesn't have to follow these weights exactly, but they show how much of the world a JSE-heavy portfolio leaves out.

Home bias: the most common diversification gap

Most South African investors hold far more South African shares and rand assets than South Africa's tiny share of world markets would suggest. Part of that is natural — familiar companies feel safer — and part of it is built in: retirement annuities, pension and provident funds can hold at most 45% offshore under Regulation 28, so a large part of most people's retirement money stays at home. It's called home bias, and it's one of the most valuable things to look at once you live abroad.

For a South African in Thailand, home bias is doubly worth examining. If you no longer live in South Africa, your future spending may have little to do with the South African economy, yet your portfolio may still be tied closely to it — in JSE companies, in rand. Broadening to a global spread gives you access to the whole world's growth and reduces your dependence on any one economy and currency, including the ones you've left.

There are practical ways to do it. Money outside retirement funds can be moved offshore on your R2 million single discretionary allowance each calendar year, with SARS approval for more. Living annuities aren't bound by Regulation 28, so once you retire you can hold more offshore. That doesn't mean selling everything South African. A portfolio can still hold JSE shares and rand assets, especially if you have South African goals such as a child's university or a possible return home. The point is to hold them by choice, in a sensible proportion, rather than by default.

Three sample portfolios

Three examples of how a diversified portfolio might be balanced for different investors. They're illustrations to show the idea — the right mix for you depends on your goals, timescale and income needs.

Illustrations, not recommendations. Many people hold more than one mix — cautious for money needed soon, growth for the long term.

Choosing your mix

The split between shares and bonds is the most important decision in your portfolio, and it comes down to three questions.

When will you need the money?

The longer your timescale, the more shares you can usually hold, because there's time to ride out falls and benefit from growth. Money you'll need in a few years belongs in steadier investments. Our guide to investment time horizons explains how to match money to time.

Will you need an income?

If you'll draw an income from your portfolio — from a living annuity, for example — you'll usually want a solid base of bonds and cash so you never have to sell shares after a fall.

How would you feel about a fall?

Be honest. If a 25% drop in your portfolio would keep you awake at night or tempt you to sell, a more balanced mix is better than a more adventurous one you can't stick with. The best portfolio is one you'll hold through good times and bad.

Many South Africans abroad end up with more than one mix: a cautious pot for the next few years, a balanced pot for the medium term and a growth pot for money they won't touch for decades. That's diversification across time, built right into the plan.

Where to start

A diversified portfolio built around your life, the best way to fund it, our number-one offshore account for the hard-currency part of your money, and a flat-fee route for everyday transfers.

Diversification for a South African abroad

A few extra considerations make a South African expat's portfolio different from one built for someone living at home.

Hold some money in baht

If you live in Thailand, part of your money should be in baht — at least your emergency fund and the next year or two of spending. That's diversification by currency, matched to your life: in 2026 alone the rand moved between about ฿1.89 and ฿2.07. Some people also hold a small slice in Thai shares or Thai funds, which for an individual can be tax-efficient: gains on SET-listed shares sold on the exchange are exempt, and Thai dividends have 10% withheld.

Mind where your funds are based

Many low-cost global funds are available in versions listed in the US and versions based elsewhere, such as Ireland or Luxembourg. For a non-American, US-listed holdings can expose your estate to US estate tax above $60,000. Choosing funds based outside the US gives you the same global diversification without that risk.

Think about every asset you own

Diversification applies to your whole financial life, not just your investment account. If you own a condo in Thailand, a house or flat in South Africa and a retirement annuity mostly invested at home, those are already large, concentrated rand and property positions. Your other investments can balance them — for example by holding mainly global shares in hard currency, and not adding more property exposure on top.

Keep costs low

Diversification is cheaper than ever. A low-cost global fund can give you thousands of companies for a fraction of a percent a year. Keeping costs down means more of the diversified growth stays with you.

The role of alternatives

Beyond mainstream shares and bonds, some investors add a smaller slice of alternative investments — for example structured products that offer a defined outcome linked to a market index, or other assets that tend to behave differently from shares and bonds. Used thoughtfully, a modest allocation can add another layer of diversification and help shape the ups and downs of a portfolio.

Alternatives work best as a complement to a well-diversified core, not a replacement for it, and they suit some investors more than others. It's important to understand exactly how each one works, what it costs and how easily you can get your money out.

Diversification only works if you stay invested

A diversified portfolio gives you a smoother ride — but there will still be bumps. Markets fall from time to time, sometimes sharply, and the temptation to sell is strongest exactly when selling does the most damage.

J.P. Morgan's research on the US market from 2005 to 2024 shows why staying invested matters: $10,000 left fully invested grew to about $71,750, but an investor who missed just the ten best days ended up with about $32,871. Many of the best days came right after the worst. A well-diversified portfolio, matched to your timescale and backed by a cash reserve, makes it far easier to stay the course — which is where the long-term rewards are.

• Keep one to two years of spending in cash so you never need to sell after a fall.
• Invest regularly — falls become buying opportunities.
• Rebalance once a year to keep your mix on track.
• Talk it through before making changes in a falling market.

Diversifying for a retirement income

In retirement, diversification takes on a new job: making sure your income keeps flowing whatever markets do. A well-built retirement portfolio — often a living annuity alongside other investments — typically combines a cash reserve covering the next year or two of withdrawals, a layer of bonds that pay steady income and can be drawn on when shares are down, and a global share portfolio for the long-term growth that keeps your income rising with prices.

That structure matters even more in Thailand, where a rand-based income buys fewer baht whenever the rand weakens, and a retirement can last thirty years. A diversified growth element, spread across hard currencies, is what allows your income to keep pace. Meanwhile, the cash and bond layers mean you're never forced to sell shares after a fall to pay the bills.

Diversification for families

Families often have several goals running at once — school fees, university, a home, retirement — each with its own timescale and currency. A good approach is to give each goal its own diversified mix: steadier investments for school fees due in the next few years, growth-oriented global portfolios for university fees a decade away, and long-term growth for retirement. Each pot is diversified on its own terms, and together they form a portfolio that serves the whole family.

Started early, an education pot invested for growth can pay a large share of future fees — more than 40% of a thirteen-year goal at 8% a year growth. That's diversification across time working for your children. Ask about school-fee planning, or compare schools in our international schools directory.

Building your diversified portfolio, step by step

1. Set your goals and timescales — retirement income, education, a home, a legacy.
2. Set aside cash first — an emergency fund and near-term spending, mostly in baht.
3. Choose your mix of shares, bonds and alternatives for each goal.
4. Spread shares across the world, using low-cost funds based outside the US.
5. Match currencies to spending, move money offshore within your allowances and fund the portfolio at a good exchange rate.
6. Choose where to hold it — a South African platform, an offshore platform, a bond or a living annuity.
7. Invest regularly where you can, or phase in a lump sum.
8. Review and rebalance once a year, and whenever your life changes.

Our guide to international investment platforms explains where to hold your portfolio as a Thai resident.

Two worked examples

Johan: from a JSE-heavy portfolio to a global one

Johan, 61, retired to Hua Hin with R7 million invested — a living annuity mostly in South African equity and balanced funds, and unit trusts he'd built up over thirty years, almost all in rand. A free review with Lawrence shows the portfolio is heavily concentrated in one market and one currency, while his spending is now in baht. Together they reshape it: the living annuity moves to a balanced mix with much more global exposure, the unit trusts are moved offshore in stages on his allowance into global share and bond funds based outside the US, two years of spending is held in cash (mostly baht), and a small slice goes to alternatives. He keeps some JSE holdings by choice rather than by default. His portfolio now owns a slice of thousands of companies around the world.

Nomsa and Kriang: building from scratch

Nomsa and Kriang, both 38, live in Bangkok and want to start investing R15,000 a month for retirement and R6,000 a month for their son's education. With Lawrence, they set up a growth-oriented global portfolio for retirement, held offshore in hard currency, and a separate education pot that will move from growth to cautious as university approaches. Both are diversified across countries and invested in funds based outside the US, and they rebalance once a year when they review their plan.

Is your portfolio well diversified? A quick check

• Do you own shares across many countries, not mainly the JSE?
• Is your share/bond mix right for your timescale and income needs?
• Is near-term spending held in cash, in baht?
• Is your long-term money spread across hard currencies, not all in rand?
• Are your funds based outside the US, avoiding US estate tax?
• Have you rebalanced in the last year?

If you answered "no" or "not sure" to any of these, a free review is a good next step.

Keeping your investments secure

A diversified portfolio is usually held across one or two platforms you manage online, often from abroad. A few habits keep it safe:

• Use a password manager and a different strong password for every account.
• Turn on two-factor sign-in on every platform and bank account.
• Use a private, protected connection on hotel, café and condo Wi-Fi.
• Never act on unexpected calls about your investments — contact the provider directly.

How we researched this guide

We used MSCI's ACWI Index factsheet (30 September 2026) for global market weights and MSCI's ACWI IMI geographic breakdown (30 June 2026) for South Africa's weight; Prudential Investment Managers' analysis of the JSE against cash (September 2018); J.P. Morgan's analysis of missing the best days (2005–2024) as reported by CNBC; KPMG on US estate tax for non-US individuals; PwC Worldwide Tax Summaries on Thai investment taxes; and South Africa's Regulation 28 and offshore allowance rules. The sample portfolios are illustrations, not recommendations. Checked 23 October 2026. Past performance is not a guide to the future and investment values can fall as well as rise. This guide is general information, not personal financial advice.